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  • #31
    Originally posted by lemontree View Post
    You make is sound as if I'm to blame ;)
    Your state is. It has to be easier for you not to vote for NCP than to expect the rest of the country not to vote for congress.

    Whether Pawar remains in power is in your state's hands. Begins or ends there.

    Originally posted by lemontree View Post
    The NCP has always had the majority here. Remember they were part of the Congress and Sharad Pawar was the Maratha warloard for the Congress (I), who broke away in 1999 after revolting against Sonia Gandhi. The farm co-operatives have always been led and controled by him and his cronies (in Maharashtra).

    The state has a coalition government of NCP and Congress and you know how that works.

    The rest of the votes are divided between SS, MNS, BJP and RPI.
    MNS and RPI cannot run a govt for the next 100 years.
    SS showed what happens when a mafia runs the govt.

    I would love to get rid of the NCP and Congress, but my alternatives are zero. The only thing that stops me from voting the BJP are their armies of Bajrang Dal, Ram Sena and their elk.
    BJP is the only alternative remaining in your state. Its some irony that all the decisions get made in Nagpur yet they cannot even win a state election but somehow aspire to win the general one. No wonder they have a Gujurati as their poster boy instead of a marathi.

    BJP was in charge of my state, i did not see any armies of bajrang dal or Ram sena. All i saw was some strategically picked PR opportunities. Over which the media had a field day with. Job done. Those armies went back to their camps content in the belief they somehow still mattered. But they don't matter, they don't get a say in what the RSS decides. The RSS just appeases them now & then to keep them quiet thereby containing them. These people cannot overturn the rule of law, they cannot over turn 65+ years of constitution building.

    Another point is you don't need to polarise people if you're in office. The nonsense happens in trying to get into office. Once in office, you have control over the way the funds flow.

    The downfall and biggest disappointment of BJP in my state was they couldn't keep their house in order. After they got into office, the infighting continued and in the end the CM got turned against his own party and started his own.
    Last edited by Double Edge; 05 Nov 13,, 17:28.

    Comment


    • #32
      @cyppok

      I'm not a financial adviser or an investment expert and nor was I talking about investments.

      Much of the world trades in US dollars. The world insists that payments be made in US dollars. When I buy a cheap LED light bulb for my bathroom from a chinese website, they insist that I pay in US dollars using paypal. Most govts in the world maintain a US dollar reserve even though they don't trade with the US. Similarly, india too doesn't really do trade with the US but it still maintains a US dollar reserve because the saudis, the chinese and the iranians insist that we pay them in dollars.

      So what is the problem?

      India doesn't have enough US dollar reserve. It's export trade doesn't make for its imports so it has to go in the market and buy US dollars to maintain a reserve. This means indians have to sell their rupees in return and this is the hard part because what will they do or buy using indian rupees? The only country they can exchange indian rupees is with india. There's not much india can sell to the world except refined petroleum products, finished diamonds, pharmaceutical medicines and agricultural produce.

      India doesn't have an export market. So when indians rush to buy gold, the govt has no choice but to undervalue its rupee just so it can buy US dollars from the market. Hence the following appeal from the indian finance minster:

      You give rupees, we have to provide dollars. You think you buy gold in rupees but actually you buy gold in dollars. I would once again appeal to everyone, please resist the temptation to buy gold
      World’s Most Traded Currencies By Value 2012
      1. United States, United States dollar USD ($) – 84.9%
      2. European Union, Euro EUR (€) – 39.1%
      3. Japan, Japanese yen JPY (₯) – 19.0%
      4. United Kingdom, Pound sterling GBP (£) – 12.9%
      5. Australia, Australian dollar AUD ($) – 7.6%
      6. Switzerland, Swiss franc CHF (Fr) – 6.4%
      7. Canada, Canadian dollar – CAD ($) – 5.3%
      8. Hong Kong, Hong Kong dollar HKD ($) – 2.4%
      9. Sweden, Swedish krona SEK (kr) – 2.2%
      10. New Zealand, New Zealand dollar NZD ($) – 1.6%
      11. South Korea, South Korean won KRW (₩) – 1.5%
      12. Singapore, Singapore dollar SGD ($) – 1.4%
      13. Norway, Norwegian krone NOK (kr) – 1.3%
      14. Mexico, Mexican peso MXN ($) – 1.3%
      15. India, Indian rupee INR (INR) – 0.9%
      Last edited by anil; 05 Nov 13,, 17:34.

      Comment


      • #33
        Originally posted by Double Edge View Post
        1. You sound resigned to continued NCP hegemony. As far as Vidarbha goes. if ever NCP starts to feel the heat then Congress will move to appease Vidharba. Maha & AP are key states that cannot be lost. If a schism exists between the people then it will be exploited and inflamed whenever necessary.
        I'm a realist. I would personally never vote for the NCP, but I don't see them losing their hold on the state (along with the Congress) in the near future. Not even the central elections, leave alone the state assembly polls.

        Election money is what funds these handouts. When congress won recently in my state the CM wanted to put a Rs.1/kg rice scheme in place but was beaten back.
        Not really. "Election money" mostly comprises finances mustered by the party itself (with some amount of course stolen from the exchequer), which go into rallies, paying party workers, giant cardboard cutouts and in Modi's case Tupac style holograms. The handouts are funded directly from public money and often from money the government does not have and is forced to borrow, increasing the state and national debt.

        I figured you were referring more to schemes like MNREGA, which seeks to provide a 100 days of employment per year. This has had a mixed reception. It has not succeed in its initial goal and has interferred in the labour market. In a way i see it as helping to keep the peace. We won't be hearing as much about farmer suicides. People that can get 100 days employment a year are less likely to turn to the Naxals. I posted about transparency of RBI and its degree earlier as its not clear how much political control gets in the way over monetary policy. RBI can only do so much, the politicos start fires and leave the RBI to put them out. If the RBI fails, blame the RBI and whoever runs it and replace the head.
        Yes MNREGA is one of the most egregious examples. It is a farce. The government cannot create jobs out of thin air. If those jobs required doing, somebody would already be doing them. Ergo they are just paying Tom to fill up the hole that they paid Harry to dig. Might as well just give them free money and ask them to go home. In either case, it only causes more problems and solves nothing in the long term.

        Inflation is driven, that is if you subscribe to Milton Friedman by excessive printing of money. We do a lot of that. Telling me not to import gold isn't an answer. People buy gold because they see 5 rupee coins approaching the weight of 1 rupee coins and decide gold is a better store of value. Is there much difference between a 50 paisa coin and a 1 rupee coin nowadays. Doesn't require an education to notice this. When coins get lighter, heavier metal is better. There's been talk about setting up gold deposits to entice people to store their gold in banks, but the interest rates offered are not attractive. You'd get a better price selling gold on the street than putting it in a bank.
        Agree completely.

        As far as infrastructure goes. The Japanese are very interested in partnering. They put up half the money at very low interest rates for the metro train projects in Delhi and my city. The trains running are from Japan. They are hoping to get into the massive corridor projects planned to link up key cities.
        Yes the Japanese have helped a lot. But most of their investment is limited to Tamil Nadu and some parts of Karnataka - which is understandable since those areas are already better developed than the rest and will give them the most RoI. They aren't lining up to invest in Bihar or the North East. We have to develop those areas on our own.

        Japanese got into debt over their eye balls by doing excessive infrastructure in Japan, Keynes to the hilt. Dig holes, fill them up and provide work. Now, they are doing the same abroad. Chinese take it to another level still and have been at it for the last decade non-stop.
        Building infrastructure is NOT digging up holes and filling them up. That is actually the MNREGA in a nutshell. Building infrastructure (not overbuilding) provides long term benefits. The new highways have already provided some payoffs. Gujarat's relative prosperity is because all villages are well connected by roads and have water and electricity. Same with any other of the relatively better developed states in India. And we are nowehere close to "overbuilding" infrastructure in India. So no need to be scared of that.
        Last edited by Firestorm; 05 Nov 13,, 18:50.

        Comment


        • #34
          Currency issues between iran and india have come up again. Previous the iranians had agreed to accept 100% payment in indian rupees but not they insist on 45% rupee and rest in euro, yen or rouble.

          Oil imports from Iran drop sharply
          No resolution in sight to the rupee mechanism issue

          Crude oil imports from Tehran have dropped by over 40 per cent this year.

          With declining imports from Iran and no resolution to the rupee mechanism issue in sight, the government has already worked on a plan to substitute its imports from Iran by increasing its crude oil purchase basket from countries such as Iraq, Venezuela and Oman.

          Iran had sometime ago conveyed to India its opposition to the 100 per cent rupee payment mechanism, and had refused to ship oil deliveries under this mechanism. It had said that it was going back to the 45 per cent rupee mechanism payment system, and the balance had to be paid either in euro, yen or rouble.

          India and Iran had opened negotiations last month to arrive at some settlement on the issue, but are yet to resolve the issue. Similarly, the failure to make the oil insurance pool fund operational had badly impacted imports as major refiners in public and private sectors have been unable to source their crude imports from Iran due to lack of proper insurance coverage. The Rs.2,000-crore fund was to be financed through the contribution of Rs.1,000 crore by the Petroleum Ministry and a similar amount by state insurers, led by GIC. “The Petroleum Ministry is yet to release Rs.500 crore in shape of first instalment to make the fund operational, which is hampering imports. We are still awaiting a word from them on the issue so that things start moving in the right direction,’’ a senior Finance Ministry official said.

          Recently, Petroleum Secretary Vivek Rae said India was targeting 13 million tonnes of oil import from Iran in 2013-14. It had already imported around two million tonnes till last month, and wanted to import another 11 million tonnes during the rest of the fiscal.

          Since July, 2011, India had paid in euro to clear 55 per cent of its purchases of Iranian oil through Ankara-based Halkbank. The remaining amount due was remitted in rupee form in the accounts of Iranian National Oil Company in Kolkata-based UCO Bank. Payments in euro through Turkey ceased from February 6 this but the rupee payments for 45 per cent of the purchases continued through UCO Bank. Iran later agreed to take all of the payments in rupees.

          India’s imports of Iranian oil have fallen to 194,000 barrels per day (bpd) during January-September, down from 324,000 bpd in the same period last year, according to latest official figures. The September volumes rose to 296,100 bpd from 151,000 bpd in August due to IOC importing two million barrels of oil from Tehran.

          The September volumes were down 8.1 per cent from a year ago.
          Meanwhile the iranian revolutionary guards have detained an indian tanker carrying oil from iraq citing "environmental and pollution" concerns.

          Iran orders release of Indian tanker - The Hindu
          Last edited by anil; 06 Nov 13,, 09:20.

          Comment


          • #35
            Originally posted by Firestorm View Post
            Building infrastructure (not overbuilding) provides long term benefits. The new highways have already provided some payoffs. Gujarat's relative prosperity is because all villages are well connected by roads and have water and electricity. Same with any other of the relatively better developed states in India. And we are nowehere close to "overbuilding" infrastructure in India. So no need to be scared of that.
            I submit that overbuilding also provides benefits. Overbuilding to some extent show capacity and capability, which in turn can generate external business. There is really no need for that 300 KM/h train from Beijing's airport, but it establishes that they have the capability for this kind of trains.

            I will bet you a cut chai from the nearest tapri, that that has led to external orders for this technology and capability.
            "Is God willing to prevent evil, but not able? Then he is not omnipotent. Is he able, but not willing? Then he is malevolent. Is he both able and willing? Then whence cometh evil? Is he neither able nor willing? Then why call him God?" ~ Epicurus

            Comment


            • #36
              Originally posted by Double Edge View Post
              BJP is the only alternative remaining in your state.

              Its some irony that all the decisions get made in Nagpur yet they cannot even win a state election but somehow aspire to win the general one. No wonder they have a Gujurati as their poster boy instead of a marathi.
              A very poor alternative. If the likes of Gadkari - who are involved in worst kind of corporate frauds are the BJPs candidates - Then no thank you.

              BJP was in charge of my state, i did not see any armies of bajrang dal or Ram sena. All i saw was some strategically picked PR opportunities. Over which the media had a field day with. Job done. Those armies went back to their camps content in the belief they somehow still mattered. But they don't matter, they don't get a say in what the RSS decides. The RSS just appeases them now & then to keep them quiet thereby containing them. These people cannot overturn the rule of law, they cannot over turn 65+ years of constitution building.
              Those are nice excuses you are making for communal and decisive forces that are part of the BJPs power base.
              What you call "PR" opportunities, affect ordinary people. The Ram Sena - was recently led by a senior BJP party member to heckle a protestant church group. These vermin were encouraged to grow during the BJP rule in your state - remember the Mangalore riots.
              Last week, 5 Bajrang Dal members were arrested for beating up a pastor in Thane district (there would have been no arrests if a BJP govt was in power).
              Even their former political allies in Orissa broke away from then because of sanghs involvement in the Orissa anti-Christian communal riots.

              Another point is you don't need to polarise people if you're in office. The nonsense happens in trying to get into office. Once in office, you have control over the way the funds flow.
              Then Godhra 2002 shouldn't have happened, only the criminals responsible for the train carnage should have been targeted by the police.
              The prosecution in the Christian Dang region is known to you.
              The downfall and biggest disappointment of BJP in my state was they couldn't keep their house in order. After they got into office, the infighting continued and in the end the CM got turned against his own party and started his own.
              Their down fall is because they mix religion with politics.

              I don't mind a corrupt man in power, but I will keep away a communal/fascist and a corrupt man from power.
              India thinks in the same manner - that is why BJP was kicked out of power by a population that is 85% Hindu.
              Last edited by lemontree; 09 Nov 13,, 04:05.

              Cheers!...on the rocks!!

              Comment


              • #37
                Originally posted by lemontree View Post
                A very poor alternative. If the likes of Gadkari - who are involved in worst kind of corporate frauds are the BJPs candidates - Then no thank you.
                Implying if Gadkari wasn't fronting then it would be ok ?

                Originally posted by lemontree View Post
                Those are nice excuses you are making for communal and decisive forces that are part of the BJPs power base.
                What you call "PR" opportunities, affect ordinary people. The Ram Sena - was recently led by a senior BJP party member to heckle a protestant church group. These vermin were encouraged to grow during the BJP rule in your state - remember the Mangalore riots.
                Last week, 5 Bajrang Dal members were arrested for beating up a pastor in Thane district (there would have been no arrests if a BJP govt was in power).
                Even their former political allies in Orissa broke away from then because of sanghs involvement in the Orissa anti-Christian communal riots.
                Not making any excuses, rather dismantling the hype that gets built up turning nobodys into somebodys. Ram Sena were nobodys until they pulled their guest house exploit in Mangalore. Oh how the media was all present and ready to film and publish and scream about encroaches on civil liberties. So obviously fake. These guys got made by the media. You mean to tell me nobody parties any more in Mangalore, they do, just means there is a little protection tax to pay now.

                Primary cause for lack of convictions is the absence of clinching evidence. Very difficult to get in communal situations. This is still better than having kangaroo courts.

                Originally posted by lemontree View Post
                Then Godhra 2002 shouldn't have happened, only the criminals responsible for the train carnage should have been targeted by the police.
                The prosecution in the Christian Dang region is known to you.
                Forget Godhra, think future. There are communal fault lines in the country that can inflame without any warning. Cannot be prevented. But will be exploited for political gain by whomever that sees an opportunity. Best way is to ensure the fire ends where it begins and does not spread. Look at any major riots over the years and this is the general pattern i see. It will hold into the future as well. The state is pretty much caught by surprise and what determines whether these riots repeat in the future or not depends on how well the last riot was handled. Were those responsible brought to justice or not.

                Relying on political parties to prevent or ameliorate communal tensions is a fools errand. Community leaders have to face each other and resolve these differences on their own. If its a turf battle then it will not get resolved, fortunes wax & wane depending on who comes or remains in power.

                As far as atrocities against christians in my state go, i see these as aberrations as my state does not have a history for this sort of thing. I got off the emotional train after seeing the BJP's stint in my state and started looking to see how significant the problems really are. In Bangalore, its non-existent. Mangalore and the surrounding region tends to have friction from time to time. Nothing major a few flare ups by interested parties trying to create opportunities, drum up business. Where do these opportunities really go. Not far. of course the spectre of communalism is always raised to scare people away from thinking and dealing with these problems.

                Voting for a party that accuses the other of communalism isn't a solution, its a recipe to prolong their rule. Goa's gone with the BJP, does this mean they are inviting communalism. They are fed up and want a change. Hope they get it and fare better with the BJP than my state did.

                Originally posted by lemontree View Post
                Their down fall is because they mix religion with politics.
                They did not offer a viable alternative to the incumbent that came before. Same applied to the JDS that preceded them as well as Congress earlier.

                Originally posted by lemontree View Post
                I don't mind a corrupt man in power, but I will keep away a communal/fascist and a corrupt man from power.
                India thinks in the same manner - that is why BJP was kicked out of power by a population that is 85% Hindu.
                communal facist is just mud slinging when the elections come around. The opposition charges the incumbents with corruption. Communal vs corrupt these are your two terms bandied about. Degrees of truth that could be used to describe both parties.

                Only thing that matters is how long does the incumbent get to stay. Congress drove this country to the brink of bankruptcy with their 40 year tenure. They had majorities throughout that time. Then we entered the coalition era and things changed. Now you cannot get the worst any party can deliver because there aren't enough of them to push it through. This is the hidden silver lining for me with coalitions, the flip side is progress is also slowed. So we move slowly & deliberately instead of taking great leaps into the unknown. You hold onto the NCP for too long and they will drive your state into a hole as well. The commies already did it to Bengal. Punjabis alternated between SAD and congress for the last twenty years. They have options.

                For me changing the incumbent is about reducing cummulative losses that inevitably accrue with extended periods of rule. No matter how bad things get in my state, i can be confident come the next elections the incumbent stands a good chance of being booted out. What about you or anybody else with a creeping incumbency problem ?

                Comment


                • #38
                  Originally posted by lemontree View Post
                  I don't mind a corrupt man in power, but I will keep away a communal/fascist and a corrupt man from power.
                  India thinks in the same manner - that is why BJP was kicked out of power by a population that is 85% Hindu.
                  Amen to that!

                  India doesn't belong to the Hindus, but to all who'd been living for ages and our Constitution guarantees that.
                  Politicians are elected to serve...far too many don't see it that way - Albany Rifles! || Loyalty to country always. Loyalty to government, when it deserves it - Mark Twain! || I am a far left millennial!

                  Comment


                  • #39
                    Originally posted by lemontree View Post

                    I don't mind a corrupt man in power, but I will keep away a communal/fascist and a corrupt man from power.
                    India thinks in the same manner - that is why BJP was kicked out of power by a population that is 85% Hindu.
                    Wrong. BJP was kicked out because they couldn't deliver the promises of economic prosperity to the villages whereas Congress promised and history showed Congress failed.

                    BJP did not engaged in communal activities as Congress did. You have your blinders on and you need to remove them and stop drinking the kool aid that Congress has been dishing out. You have fallen for the stupid trap and fearmongering that Congress uses to prey on the masses.

                    Comment


                    • #40
                      Originally posted by Blademaster View Post
                      Wrong. BJP was kicked out because they couldn't deliver the promises of economic prosperity to the villages whereas Congress promised and history showed Congress failed.
                      The BJP did fairly well with its economic policies given the circumstances.
                      They F_up just as Congress did w.r.t foreign policy, corruption etc.

                      I was quite satisfied with their work. The communal carnage is what undid them.


                      BJP did not engaged in communal activities as Congress did. You have your blinders on and you need to remove them and stop drinking the kool aid that Congress has been dishing out. You have fallen for the stupid trap and fearmongering that Congress uses to prey on the masses.
                      My friend you forget - my impressions are not obtained by a media or twitter campaign.
                      I was in a a train on the Konkan railway in 1991, and witness to the hooliganism of the Bajrang Dal against the muslims in the train.
                      In Dec 2000, a hoard of Bajrang Dal, disrupted a Christamas Dance in the suburb of Borivli - stating it was against their culture.

                      Maybe you got to see the evil within the cause/group you espouse.

                      Cheers!...on the rocks!!

                      Comment


                      • #41
                        Originally posted by lemontree View Post
                        My friend you forget - my impressions are not obtained by a media or twitter campaign.
                        I was in a a train on the Konkan railway in 1991, and witness to the hooliganism of the Bajrang Dal against the muslims in the train.
                        In Dec 2000, a hoard of Bajrang Dal, disrupted a Christamas Dance in the suburb of Borivli - stating it was against their culture.
                        Can add more to that list. But the more important question is how enduring are these acts. One offs, or not. Are they the norm or the exception. You're referring to acts of questionable legality. let me tell you about the more legal moves. Take bills introduced and passed against cow slaugther. These bills have the primary goal of banning the sale of beef and criminalising its possession. They passed one in MP in the mid 90s, the supreme court knocked it down because you cannot deprive a butcher of his livelihood. Constitutional backing there.

                        They tried the same in my state, passed bills in both the assembly and council. Then it went to the governor who passed it onto the president who did nothing and it lapsed. Never mind that we already passed a cow slaughter act in the mid 60s. These bills wanted to add more restrictions on top. So I look at these moves as vote bank appeasement. Nobody can say they did not try but very few realise that the chances of success were very low to begin with.

                        Politics is a profession where you get to promise the world and can still get away if you do not deliver. But mess up in more important areas like economy and you're out.

                        Originally posted by lemontree View Post
                        Maybe you got to see the evil within the cause/group you espouse.
                        Pressure tactics that fall woefully short and should not scare anybody into submission. Whose main objective is PR. These acts do not continue on a regular basis do they. They occur in sensitive areas, from time to time, a show of force for tactical purposes. Less is more.

                        How successful are they in modifiying behaviours.
                        How successful are they in attaining their goals.
                        Last edited by Double Edge; 13 Nov 13,, 17:18.

                        Comment


                        • #42
                          Originally posted by lemontree View Post
                          I was quite satisfied with their work. The communal carnage is what undid them.
                          What communal carnage did BJP do?

                          My friend you forget - my impressions are not obtained by a media or twitter campaign.
                          I was in a a train on the Konkan railway in 1991, and witness to the hooliganism of the Bajrang Dal against the muslims in the train.
                          In Dec 2000, a hoard of Bajrang Dal, disrupted a Christamas Dance in the suburb of Borivli - stating it was against their culture.

                          Maybe you got to see the evil within the cause/group you espouse.
                          So you are blaming one group for another group's actions. I do not see Bajrang Dal being affiliated with BJP. Even BJP came out against Bajrang Dal and the leaders of BJP made strong statements against Bajrang Dal. Should we blame Congress for the actions of BSP or SIMI? Your argument does not have merit.

                          In essence you re saying that you are willing to forego the economic progress that BJP will bring because you are afraid that BJP will commit the actions of another group that it condemned? This is the attitude that I deplore strongly because you are letting your fear control your decisions. You refuse to give BJP any chance of proving themselves. The economic success that Congress and UPA enjoyed in its first term were leftover progress from the NDA's economic reforms. They pretty much coasted on NDA's reforms and when the reforms ran out of steam, Congress went around like a headless chicken clucking and it has seriously harmed the welfare of this country. You should be more afraid of that than some actions of small time punks like Bajrang Dal.

                          Comment


                          • #43
                            Originally posted by anil View Post
                            @cyppok



                            India doesn't have an export market. So when indians rush to buy gold, the govt has no choice but to undervalue its rupee just so it can buy US dollars from the market. Hence the following appeal from the indian finance minster:



                            World’s Most Traded Currencies By Value 2012
                            The gov't always has a choice. The reasons they give for debasement are usually self-serving.
                            They could have cut the budget and fired bureaucrats to balance the difference they didn't get but they chose to debase and shift the problem.

                            The local people whom have no liquid assets cannot escape the hammer of impact from this policy. But if you have international investors putting real capital into income producing assets in your company they will make sure you cannot skin them when you do a debasement.

                            When they debase their attempt is to make the capital recovery for those people longer or negative it does not work because if they get that wish there is no incentive to participate in the economy without loosing over long periods of time and with financing in the present time.

                            Put yourself in a position of a company that has 5 million a year in rupees and 50 million investment in a factory. How do you hedge the risk of currency?... you could short the rupee via gov't bonds or other companies or their debt whom issued in that currency.
                            Originally from Sochi, Russia.

                            Comment


                            • #44
                              Will India’s Economics Be a Victim of its Politics? | Carnegie | Oct 21 2013

                              Consensus here is it does not matter whether BJP or Congress wins, we've stuck with 3-4% growth for the next 3-4 years. If Modi gets it all we get is a stock market rally. As Modi alone cannot bring back investment growth. For that, structural change is required. Until it happens there won't be a rapid turnaround in investment. Policy (or rather the lack of good policy) since 2009 is one of the causes. Why ? the contract between the technocrats & the politicians broke down. The technocrats accepted lower growth as a fact of life but the politicians were unwilling. This relationship has to be repaired and brought back in sync. Its important that whichever party wins, that the politicians accept growth will be slow and not try to manipulate things otherwise it will get worse later.

                              They put India's growth in the last few years down to easy credit. As there has been very little institutional change in that time. The same institutions that for 60 years delivered 3% growth all of a sudden offered 10%. Nobody questioned how it was possible. Now people want to know why it isn't as high any more.

                              As far as getting downgraded to junk status, there are two factors here, how the fiscal deficit is managed and growth. The belief is we can get the deficit under control. But slower growth is down to 3 factors
                              - Our laws & institutions did not keep up with growth. We're still stuck with discretionary govt spending and non-transparency. Difficult and will take time. 3-4 years. Investment frameworks have to be worked. Its difficult to invest in India as the implementation risks have risen since 2008. Resource pricing as well as service delivery has to be changed. Last year 21,000 megawatts of power were added but this year they could not be run because of coal shortages.

                              - cyclical downturn, other emerging markets are also a facing growth slowdown.
                              - we've exacerbated the downturn by bad macro policy since 2009.

                              Does this mean we get downgraded next year ? we will see. Rating agencies putting a gun to India's head should hopefully spur the necessary changes, at least the most urgent ones.

                              RBI can be more effective if it has more focus (inflation control say) and less conflicting objectives. How much leadership and direction, maybe transparency is the better word, can the RBI governor exert. There's a lot of expectation but the new RBI governors actions haven't been tested yet.

                              3 possibilities for next may, BJP led, UPA led and NDA led by Jaya. Nobody has a clue as to what BJP's economic reform will be. What they proposed when they were in power, they opposed when out of office. So clarity is important regardless of the party that wins. The interesting point is a weak & indecisive govt isn't a problem, rather its when a weak & indecisive govt interferes in the economy that things get into a mess.
                              Last edited by Double Edge; 16 Nov 13,, 09:35.

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